Dr Hollingworth announced on Friday he had returned his permission to officiate, following last month's findings from the Professional Standards Board for the Anglican Diocese of Melbourne.
The inquiry found the former archbishop of Brisbane committed misconduct in retaining two clergy members he knew were child sex offenders.
But it ruled there was no threat of unacceptable risk to others if he continued in the ministry within limited and defined duties.
Dr Hollingworth said he was concerned that continuing to serve in the church would cause pain to survivors.
"I want to end distress to them and division within the church," he said in a statement on Friday.
Dr Hollingworth said he was ill-equipped to deal with child abuse complaints when he was the archbishop in the 1990s but maintained he had not committed any crimes.
"I did not cover up sexual abuse. And I was not an abuser," he said.
Dr Hollingworth will no longer perform services, marriages, funerals or baptisms but said he would continue his lifelong commitment to social justice.
The 88-year-old was archbishop between 1990 to 2001 before becoming Australia's 23rd governor-general.
He resigned from the role in 2003 after a series of revelations about his response to multiple child sex abuse complaints.
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